Climate Change Threatens Italy's Cheese Economy
Banks using Parmigiano cheese as collateral face challenges.
1Cheese Collateral for Loans
In Emilia-Romagna, Credito Emiliano bank has accepted Parmigiano Reggiano cheese as collateral since 1953. The bank's vault holds over 500,000 wheels of cheese, valued at more than €300 million. This system provides cash flow to small family farms. The cheese must age for at least 12 months, during which farmers need financial support.
2Modernization with Blockchain
Magazzini Generali delle Tagliate, a subsidiary of Credem, ages the cheese in warehouses in Reggio Emilia and Modena. Blockchain technology allows farmers to pledge cheese while keeping it in their own facilities. This innovation doubled the bank's lending capacity and made the process more efficient.
3Impact of Climate Change
Record temperatures in Europe increased energy consumption in cheese warehouses by 30%. The bank had to upgrade cooling systems and boilers. Additionally, heat reduced cows' milk production by 10%, raising cheese production costs and putting pressure on the industry.
4Italy's Wine and Olive Oil Sectors
In Franciacorta, the 2026 harvest started earlier than ever recorded. In Sicily, the harvest period extended to 100 days. Olive oil production also declined; Puglia and Calabria saw output drop below 350,000 tons. Climate change is broadly affecting the agricultural sector.
5Economic Effects
R. Jisung Park from the University of Pennsylvania notes that heat's economic impacts are indirect and delayed. For example, heat stress on dairy cows turns into a cost problem for banks months later. Park emphasizes that these effects are still underestimated by companies and governments.
6Similar Practices in the U.S.
During the Great Depression, milk prices collapsed, and farmers dumped their products in the streets. Franklin D. Roosevelt's New Deal provided subsidies to farmers and established the Commodity Credit Corporation. This agency purchased surplus butter, cheese, and dried milk to stabilize prices.
7Future Scenarios
Climate change will continue to impact Italy's cheese, wine, and olive oil sectors in the long term. Rising temperatures will increase production costs and may reduce product quality. This could negatively affect both the local economy and exports.
8Proposed Solutions
Banks and farmers can reduce energy costs by investing in renewable energy sources. Additionally, developing climate-resilient farming techniques can optimize production processes. Governments can facilitate this transition by providing financial support to the sector.
Original article: Fortune | FORTUNE — İklim Değişikliği İtalya'nın Peynir Ekonomisini Tehdit Ediyor